Einstein Noah Restaurant Group Reports Fourth Quarter and Fiscal 2012 Financial Results
Einstein Noah Restaurant Group Reports Fourth Quarter and Fiscal 2012
Financial Results
Seventh Consecutive Quarter of Positive System-Wide Comparable Restaurant
Sales
Record Revenues, Record Adjusted EBITDA, & Record Cash Flow from Operations
for Fiscal 2012
Business Wire
LAKEWOOD, Colo. -- February 28, 2013
Einstein Noah Restaurant Group, Inc. (NASDAQ: BAGL), a leader in the
quick-casual segment of the restaurant industry operating under the Einstein
Bros.® Bagels, Noah's New York Bagels®, and Manhattan Bagel® brands, today
reported financial results for the 13-week fourth quarter and 52-week fiscal
year ended January 1, 2013. The fourth quarter and fiscal year in 2011 were 14
weeks and 53 weeks, respectively.
Highlights for the 13-Week Fourth Quarter 2012 Compared to the 14-Week Fourth
Quarter 2011; and for the 52-Week Fiscal 2012 Compared to the 53-Week Fiscal
2011:
* System-wide comparable store sales for the fourth quarter increased 1.4%,
the seventh consecutive quarter of positive trends. For the year,
system-wide comparable store sales increased 1.0%.
* Total revenues decreased $4.5 million, or 3.9%, to $110.6 million from
$115.1 million reflecting the impact of the additional revenues from the
14^th week in the fourth quarter of 2011. Total revenues for the year
increased $3.4 million, or 0.8%, to a record $427.0 million from $423.6
million.
* Excluding the extra week in fiscal 2011, total revenues increased 2.6% in
2012 for the fourth quarter and for the year, with revenue growth offset
by the closure of the Company’s commissaries.
* For the year, adjusted EBITDA increased $5.2 million, or 11.7%, to a
record $49.7 million from $44.5 million. (*)
* Cash flow from operations for the year increased 24.0% to a record $48.5
million from $39.1 million.
* Net income for the fourth quarter was $3.2 million, or $0.18 per diluted
share. For the year, net income was $12.7 million, or $0.74 per diluted
share compared to net income of $13.2 million, or $0.78 per diluted share.
* For the year, adjusted net income increased $3.3 million, or 25.2%, to
$16.4 million, or $0.95 adjusted earnings per diluted share, compared to
adjusted net income of $13.1 million, or $0.78 adjusted earnings per
diluted share, on a comparable 52-week basis. (*)
* The Company paid a total of $76.6 million in a one-time special and
regular quarterly dividends.
Jeff O’Neill, President and Chief Executive Officer, stated, “2012 was a
strong year at Einstein Noah as we successfully executed on our key objectives
and delivered strong financial results to our shareholders. We achieved record
revenues, record adjusted EBITDA, and record operating cash flow through a
combination of positive comparable sales, unit development, and operational
improvements. We also returned a substantial amount of capital through a
one-time special dividend as well as our regular quarterly dividends, further
demonstrating our long-term confidence in the business.”
O’Neill continued, “Specific to the fourth quarter, we generated our highest
comparable sales result of the year and seventh consecutive quarter of
comparable store sales growth overall as our product and marketing initiatives
resonated with customers. From a profitability standpoint, gross profit
margins as a percentage of revenues improved reflecting the positive impact of
our initiatives. All in all, we consider the fourth quarter a fine ending to a
year in which we created and unlocked value for the benefit of all
shareholders.”
Fourth Quarter 2012 Financial Results
For the fourth quarter ended January 1, 2013, system-wide comparable store
sales increased 1.4% on a 13-week basis, reflecting 3.9% growth in average
check. The higher average check was driven by a combination of favorable
product mix and price.
Total revenues decreased 3.9% to $110.6 million from $115.1 million,
reflecting a 3.4% decrease in Company-owned restaurant revenues, a 12.9%
decrease in manufacturing and commissary revenues (related to the planned
commissary closures earlier in the year, offset by higher revenues from the
manufacturing facility to third parties), and a 4.7% increase in franchise and
license related revenues. Excluding the extra week in fiscal 2011, total
revenues increased 2.6% in 2012 for the fourth quarter. The year-ago fiscal
period benefitted from an incremental 14^th week, which contributed $7.3
million in total revenues to the fourth quarter of 2011.
Restaurant gross margin was a strong 20.5%, down 100 basis points as a
percentage of restaurant sales from 21.5% in fiscal 2011 reflecting the
deleveraging of many fixed costs as a result of not having the benefit of the
incremental operating week in the fourth quarter of 2012. The benefit of
having an extra week in the fourth quarter of 2011 improved restaurant gross
margin by approximately 100 basis points. Prime costs, defined as cost of
sales plus labor costs, were 120 basis points lower than the prior-year
period.
Manufacturing and commissary gross margin as a percentage of manufacturing and
commissary revenues increased from 11.3% to 23.2% and was driven by benefits
from various cost initiatives, and the commissary closures earlier in the
year.
Overall, gross profit was $25.5 million in the fourth quarter of 2012 compared
to $26.3 million in the fourth quarter of 2011, but as a percentage of total
revenues, increased 20 basis points to 23.1% from 22.9% in the year-ago
period.
General and administrative expenses decreased to $9.4 million in the fourth
quarter of 2012 from $9.5 million in the fourth quarter of 2011 and reflect a
decrease in expense due to one less week of operations offset by higher
variable compensation expense.
Pre-opening expenses increased to $711,000 compared to $110,000 as a result of
opening 11 company-owned restaurants in the fourth quarter of 2012 compared to
opening 2 company-owned restaurants in the fourth quarter of 2011.
The Company incurred $3.0 million in expenses related to the completion of the
strategic alternative review process and $1.2 million in expense related to an
employee benefit settlement in the fourth quarter of 2012 and reported in the
Other operating expenses, net line. The Company incurred $0.8 million of
restructuring expenses in the fourth quarter of 2011 primarily related to its
decision to close its five food commissaries.
Adjusted EBITDA was $15.4 million in the fourth quarter of 2012 compared to
$16.8 million in the fourth quarter of 2011, but was up 11.7% to $49.7 million
for fiscal 2012. (*)
Net income in the fourth quarter of 2012 was $3.2 million, or $0.18 per
diluted share, which included $0.15 per diluted share for strategic
alternatives and employee benefit audit settlement expenses. Net income in the
fourth quarter of 2011 was $6.1 million, or $0.36 per diluted share, which
included $0.03 per diluted share for restructuring expenses. The impact of the
14^th week in the fourth quarter of 2011 was approximately $0.03 in earnings
per diluted share.
For the year, net income was $12.7 million, or $0.74 per diluted share
compared to net income of $13.2 million, or $0.78 per diluted share.
On a comparable 52-week basis, adjusted net income increased $3.3 million, or
25.2%, to $16.4 million, or $0.95 adjusted earnings per diluted share,
compared to adjusted net income of $13.1 million, or $0.78 adjusted earnings
per diluted share. (*)
* A reconciliation of the non-GAAP measure to the nearest GAAP measure can be
found in the accompanying tables below.
Restaurant Development
As of January 1, 2013, there were 816 Einstein Bros.® Bagels, Noah's New York
Bagels®, and Manhattan Bagel® branded restaurants in operation. During the
fourth quarter of 2012, the Company opened 11 company-owned restaurants and
ended the quarter with 461 Company-owned and operated restaurants, while
franchisees and licensees opened 4 and 5 restaurants, respectively, and ended
the period with 97 and 258 restaurants, respectively.
Fiscal 2013 Guidelines
The Company is providing the following guidelines for the 52-week fiscal year.
* 60 to 80 system-wide openings, including 15 to 20 Company-owned
restaurants, 15 to 20 franchise restaurants, and 30 to 40 license
restaurants.
* Capital expenditures of $20 million to $22 million.
* Cost of goods inflation of approximately 2% to 3%, which the Company
expects to be fully offset through efficiency initiatives.
* Pre-opening expense of $65,000 to $75,000 per new company-owned unit.
* Interest expense of $6.5 million to $7.0 million.
* An annual effective tax rate not to exceed 39%; however, the Company
expects to only pay minimal cash-taxes for the next several years.
Conference Call Today
The Company will host a conference call to discuss its fourth quarter and
fiscal 2012 financial results today at 3:00 p.m. Mountain Time (5:00 p.m.
Eastern Time). Hosting the call will be Jeff O’Neill, President and Chief
Executive Officer, and Manny Hilario, Chief Financial Officer.
The dial-in numbers for the conference call are 888-428-9480 for domestic
toll-free calls and 719-325-2362 for international. A telephone replay will be
available through March 7, 2013, and may be accessed by dialing 877-870-5176
for domestic toll-free calls or 858-384-5517 for international. The conference
ID is 3094520.
The conference call will also be webcast live from Einstein Noah’s website at
www.einsteinnoah.com.
About Einstein Noah Restaurant Group
Einstein Noah Restaurant Group, Inc. is a leading company in the quick casual
restaurant industry that operates franchises and licenses locations under the
Einstein Bros.®, Noah's New York Bagels® and Manhattan Bagel® brands. The
Company's retail system consists of over 820 restaurants in 40 states and the
District of Columbia. It also operates a dough production facility. The
Company's stock is traded on the NASDAQ under the symbol BAGL. Visit
www.einsteinnoah.com for additional information.
Forward Looking Statement Disclosure
Certain statements in this press release, including statements under the
heading “Fiscal 2013 Guidelines”, constitute forward-looking statements or
statements which may be deemed or construed to be forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995.
The words “guideline,” “forecast,” “estimate,” “project,” “plan to,” “is
designed to,” “look forward,” “expects,” “prospects,” “intend,” “indications,”
“expect,” “should,” “would,” “believe,” “target,” “trend,” “contemplate,”
“anticipates” and similar expressions and all statements which are not
historical facts are intended to identify forward-looking statements. These
forward-looking statements involve and are subject to known and unknown risks,
uncertainties and other factors which could cause the Company's actual
results, performance (financial or operating), or achievements to differ
materially from the future results, performance (financial or operating), or
achievements expressed or implied by such forward-looking statements. These
unknown risks, uncertainties and other factors include but are not limited to
(i) the results for the 2012 fourth quarter and year over year revenue and
other financial results, comparable store sales, and margin performance are
not necessarily indicative of future results, and our expectations for 2013
results are subject to shifting consumer preferences, new product execution,
economic conditions, weather, competition, seasonal factors and cost
containment initiatives, among other factors; (ii) our ability to improve
transactions and our long-term growth are dependent upon consumer acceptance
of our products and marketing initiatives, general economic and market
conditions, among other factors; (iii) our ability to continue to improve
store level margins and contain costs are dependent upon successfully
executing plans for productivity improvements, labor efficiencies and food
cost management; (iv) the ability to develop and open new company-owned,
license and franchise restaurants and upgrade company-owned restaurants is
dependent upon the availability of capital, securing acceptable financing and
lease terms for desired locations, as well as the availability of contractors
and materials, and securing necessary permits and licenses; (v) our ability to
expand our development pipeline and ultimately expand our royalty stream is
dependent upon the factors listed in (iv), above, and our ability to attract
franchisees and licensees and negotiate favorable agreements; (vi) our ability
to obtain lower costs for agricultural commodities is dependent upon weather,
crop yield and production, the market, economic conditions, including market
and inflationary pressures; (vii) our ability to build brand equity and create
long-term value for our shareholders is dependent upon the success of our
initiatives, financial results and the factors listed above, among other
factors. These and other risks are more fully discussed in the Company's SEC
filings.
Use of Non-GAAP Financial Information
In addition to the results reported in accordance with accounting principles
generally accepted in the United States of America (“GAAP”) included in this
filing, the Company has provided certain non-GAAP financial information,
including non-GAAP total revenues excluding the extra week in fiscal 2011;
adjusted earnings before interest, taxes, depreciation and amortization,
restructuring expenses, strategic alternative expenses, write-off of debt
issuance costs, and other operating expenses/income (“Adjusted EBITDA”); net
income adjusted for the extra 53rd week in fiscal 2011, restructuring
expenses, strategic alternatives expense, incremental interest expense on
additional credit facility borrowings and other operating expenses/income
(“Adjusted Net Income”); earnings per share adjusted for the extra 53rd week
in fiscal 2011, restructuring expenses, strategic alternatives expense,
incremental interest expense on additional credit facility borrowings and
other operating expenses/income (“Adjusted Net Income Per Share”); and “Free
Cash Flow”, which the Company defines as net cash provided by operating
activities less net cash used in investing activities. Management believes
that the presentation of this non-GAAP financial information provides useful
information to investors because this information may allow investors to
better evaluate our ongoing business performance and certain components of our
results. In addition, the Company’s Board of Directors uses this non-GAAP
financial information to evaluate the performance of the Company and its
management team. This information should be considered in addition to the
results presented in accordance with GAAP, and should not be considered a
substitute for the GAAP results. We have reconciled the non-GAAP financial
information to the nearest GAAP measures.
The Company includes in this report information on system-wide comparable
store sales percentages. System-wide comparable store sales percentages refer
to changes in sales of our restaurants, whether operated by the company or by
franchisees and licensees, in operation for six fiscal quarters including
those restaurants temporarily closed for an immaterial amount of time. Some of
the reasons restaurants may be temporarily closed include remodeling,
relocations, road construction, rebuilding related to site-specific
catastrophes and natural disasters. Franchise and license comparable store
sales percentages are based on sales of franchised and licensed restaurants,
as reported by franchisees and licensees. Management reviews the increase or
decrease in comparable store sales to assess business trends. Comparable store
sales exclude permanently closed locations. When the Company intends to
relocate a restaurant, it considers that restaurant to be temporarily closed
for up to twelve months after it ceases operations. If a suitable relocation
site has not been identified by the end of twelve months, the Company
considers the restaurant to be permanently closed. Until that time, the
Company includes the restaurant in its open store count, but exclude its sales
from our comparable store sales. As of January 1, 2013, there are seven stores
that the Company intends to relocate, and are thus considered to be
temporarily closed.
The Company uses company-owned store sales, franchise and license sales and
the resulting system-wide sales information internally in connection with
restaurant development decisions, planning, and budgeting analyses. The
Company believes system-wide comparable store sales information is useful in
assessing consumer acceptance of our brands; facilitates an understanding of
our financial performance and the overall direction and trends of sales and
operating income; helps us appreciate the effectiveness of our advertising and
marketing initiatives; and provides information that is relevant for
comparison within the industry.
Comparable store sales percentages are non-GAAP financial measures, which
should not be considered in isolation or as a substitute for other measures of
performance prepared in accordance with GAAP, and may not be equivalent to
comparable store sales as defined or used by other companies. The Company does
not record franchise or license restaurant sales as revenues. However, royalty
revenues are calculated based on a percentage of franchise and license
restaurant sales, as reported by the franchisees or licensees.
EINSTEIN NOAH RESTAURANT GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except earnings per share and related share information)
Fiscal quarter ended Increase/
(in thousands) (Decrease)
January 3, January 1,
2012 2013 2012
(14 weeks) (13 weeks) vs. 2011
Revenues:
Company-owned restaurant $ 103,000 $ 99,519 (3.4 %)
sales
Manufacturing and commissary 9,002 7,841 (12.9 %)
revenues
Franchise and license related 3,139 3,286 4.7 %
revenues
Total revenues 115,141 110,646 (3.9 %)
Cost of sales (exclusive of
depreciation and amortization shown
separately below):
Company-owned restaurant
costs
Cost of goods sold 30,040 26,893 (10.5 %)
Labor costs 29,016 28,930 (0.3 %)
Rent and related expenses 10,117 10,669 5.5 %
Other operating costs 9,619 10,192 6.0 %
Marketing costs 2,023 2,413 19.3 %
Total company-owned 80,815 79,097 (2.1 %)
restaurant costs
Manufacturing and commissary 7,988 6,021 (24.6 %)
costs
Total cost of sales 88,803 85,118 (4.1 %)
Gross margin:
Company-owned restaurant 22,185 20,422 (7.9 %)
Manufacturing and commissary 1,014 1,820 79.5 %
Franchise and license 3,139 3,286 4.7 %
Total gross margin 26,338 25,528 (3.1 %)
Operating expenses:
General and administrative 9,464 9,375 (0.9 %)
expenses
Depreciation and amortization 5,276 4,915 (6.8 %)
Pre-opening expenses 110 711 **
Restructuring expenses 765 - **
Strategic alternatives - 2,992 **
expense
Other operating expenses, net 381 1,273 234.1 %
Income from operations 10,342 6,262 (39.5 %)
Interest expense, net 852 1,062 24.6 %
Income before income taxes 9,490 5,200 (45.2 %)
Provision for income taxes 3,370 2,033 (39.7 %)
Net income $ 6,120 $ 3,167 (48.3 %)
Net income – Basic $ 0.36 $ 0.19 (47.2 %)
Net income – Diluted $ 0.36 $ 0.18 (50.0 %)
Cash dividend declared per common $ 0.125 $ 4.125 **
share
Weighted average number of common
shares outstanding:
Basic 16,809,502 16,992,803 1.1 %
Diluted 17,022,819 17,278,632 1.5 %
** Not meaningful
EINSTEIN NOAH RESTAURANT GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
PERCENTAGE RELATIONSHIP TO TOTAL REVENUES
(unaudited)
Fiscal quarter ended
(percent of total revenue)
January 3, January 1,
2012 2013
(14 weeks) (13 weeks)
Revenues:
Company-owned restaurant sales 89.5 % 89.9 %
Manufacturing and commissary revenues 7.8 % 7.1 %
Franchise and license related revenues 2.7 % 3.0 %
Total revenues 100.0 % 100.0 %
Cost of sales (exclusive of depreciation and
amortization shown separately below):
Company-owned restaurant costs (1)
Cost of goods sold 29.2 % 27.0 %
Labor costs 28.2 % 29.2 %
Rent and related expenses 9.8 % 10.7 %
Other operating costs 9.3 % 10.2 %
Marketing costs 2.0 % 2.4 %
Total company-owned restaurant costs 78.5 % 79.5 %
Manufacturing and commissary costs (2) 88.7 % 76.8 %
Total cost of sales 77.1 % 76.9 %
Gross margin:
Company-owned restaurant (1) 21.5 % 20.5 %
Manufacturing and commissary (2) 11.3 % 23.2 %
Franchise and license 100.0 % 100.0 %
Total gross margin 22.9 % 23.1 %
Operating expenses:
General and administrative expenses 8.2 % 8.5 %
Depreciation and amortization 4.6 % 4.4 %
Pre-opening expenses 0.1 % 0.6 %
Restructuring expenses 0.7 % 0.0 %
Strategic alternatives expense 0.0 % 2.7 %
Other operating expenses, net 0.3 % 1.2 %
Income from operations 9.0 % 5.7 %
Interest expense, net 0.8 % 1.0 %
Income before income taxes 8.2 % 4.7 %
Provision for income taxes 2.9 % 1.8 %
Net income 5.3 % 2.9 %
(1) As a percentage of company-owned
restaurant sales
(2) As a percentage of manufacturing and commissary revenues
EINSTEIN NOAH RESTAURANT GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except earnings per share and related share information)
Fiscal year ended Increase/
(in thousands) (Decrease)
January 3, January 1,
2012 2013 2012
(53 weeks) (52 weeks) vs. 2011
Revenues:
Company-owned restaurant $ 378,723 $ 384,783 1.6 %
sales
Manufacturing and 34,542 31,037 (10.1 %)
commissary revenues
Franchise and license 10,330 11,186 8.3 %
related revenues
Total revenues 423,595 427,006 0.8 %
Cost of sales (exclusive of
depreciation and amortization
shown separately below):
Company-owned restaurant
costs
Cost of goods sold 112,002 106,925 (4.5 %)
Labor costs 110,467 111,784 1.2 %
Rent and related expenses 40,277 41,993 4.3 %
Other operating costs 39,092 40,320 3.1 %
Marketing costs 9,796 11,380 16.2 %
Total company-owned 311,634 312,402 0.2 %
restaurant costs
Manufacturing and 30,441 24,236 (20.4 %)
commissary costs
Total cost of sales 342,075 336,638 (1.6 %)
Gross margin:
Company-owned restaurant 67,089 72,381 7.9 %
Manufacturing and 4,101 6,801 65.8 %
commissary
Franchise and license 10,330 11,186 8.3 %
Total gross margin 81,520 90,368 10.9 %
Operating expenses:
General and administrative 36,774 39,569 7.6 %
expenses
Depreciation and 19,259 19,707 2.3 %
amortization
Pre-opening expenses 265 1,115 **
Restructuring expenses 1,099 480 (56.3 %)
Strategic alternatives - 3,677 **
expense
Other operating (income) (395 ) 1,592 **
expenses, net
Income from operations 24,518 24,228 (1.2 %)
Interest expense, net 3,357 3,384 0.8 %
Income before income taxes 21,161 20,844 (1.5 %)
Provision for income taxes 7,958 8,103 1.8 %
Net income $ 13,203 $ 12,741 (3.5 %)
Net income – Basic $ 0.79 $ 0.75 (5.1 %)
Net income – Diluted $ 0.78 $ 0.74 (5.1 %)
Cash dividends declared per $ 0.375 $ 4.500 1100.0 %
common share
Weighted average number of common
shares outstanding:
Basic 16,629,098 16,935,018 1.8 %
Diluted 16,880,321 17,217,180 2.0 %
** Not meaningful
EINSTEIN NOAH RESTAURANT GROUP, INC.
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except earnings per share and related share information)
(unaudited)
Fiscal year ended
(percent of total revenue)
January 3, January 1,
2012 2013
(53 weeks) (52 weeks)
Revenues:
Company-owned restaurant sales 89.4% 90.1%
Manufacturing and commissary revenues 8.2% 7.3%
Franchise and license related revenues 2.4% 2.6%
Total revenues 100.0% 100.0%
Cost of sales (exclusive of depreciation and
amortization shown separately below):
Company-owned restaurant costs (1)
Cost of goods sold 29.6% 27.8%
Labor costs 29.2% 29.0%
Rent and related expenses 10.6% 10.9%
Other operating costs 10.3% 10.5%
Marketing costs 2.6% 3.0%
Total company-owned restaurant costs 82.3% 81.2%
Manufacturing and commissary costs (2) 88.1% 78.1%
Total cost of sales 80.8% 78.8%
Gross margin:
Company-owned restaurant 17.7% 18.8%
Manufacturing and commissary 11.9% 21.9%
Franchise and license 100.0% 100.0%
Total gross margin 19.2% 21.2%
Operating expenses:
General and administrative expenses 8.7% 9.3%
Depreciation and amortization 4.5% 4.6%
Pre-opening expenses 0.0% 0.3%
Restructuring expenses 0.3% 0.1%
Strategic alternatives expense 0.0% 0.9%
Other operating (income) expenses, net (0.1%) 0.4%
Income from operations 5.8% 5.7%
Interest expense, net 0.8% 0.8%
Income before income taxes 5.0% 4.9%
Provision for income taxes 1.9% 1.9%
Net income 3.1% 3.0%
(1) As a percentage of Company-owned restaurant sales
(2) As a percentage of manufacturing revenues
EINSTEIN NOAH RESTAURANT GROUP, INC.
SELECTED FINANCIAL INFORMATION
(in thousands)
Selected Consolidated Balance Sheet January 3, 2012 January 1, 2013
Information:
Cash and cash equivalents, end of period $ 8,652 $ 17,432
Property, plant and equipment, net 59,017 63,013
Total assets 204,732 213,613
Total debt 74,200 136,700
Total liabilities 116,919 186,106
Fiscal year ended
Selected Consolidated Cash Flow January 3, 2012 January 1, 2013
Information:
Net cash provided by operating $ 39,110 $ 48,511
activities
Net cash used in investing activities (23,685 ) (25,861 )
Net cash used in financing activities (18,541 ) (13,870 )
Free cash flow (cash provided by
operating
15,425 22,650
activities less cash used in investing
activities)
Reconciliation of GAAP to Non-GAAP Measures: Fiscal quarter ended
January 3, January 1,
2012 2013
(14 weeks) (13 weeks)
(in thousands)
Net income $ 6,120 $ 3,167
Adjustments to net income:
Interest expense, net 852 1,062
Provision for income taxes 3,370 2,033
Depreciation and amortization 5,276 4,915
Restructuring expenses 765 -
Strategic alternative expenses - 2,992
Other operating expense, net 381 1,273
Adjusted EBITDA $ 16,764 $ 15,442
EINSTEIN NOAH RESTAURANT GROUP, INC.
SELECTED FINANCIAL INFORMATION
Reconciliation of GAAP to Non-GAAP Measures: Fiscal year ended
January 3, January 1,
2012 2013
(53 weeks) (52 weeks)
Net income $ 13,203 $ 12,741
Adjustments to net income:
Interest expense, net 3,357 3,384
Provision for income taxes 7,958 8,103
Depreciation and amortization 19,259 19,707
Restructuring expenses 1,099 480
Strategic alternative expenses - 3,677
Other operating (income) expense, net (395 ) 1,592
Adjusted EBITDA $ 44,481 $ 49,684
Trailing 12 Months Activity
Company
Owned Franchised Licensed Total
Consolidated Total
Beginning balance - January 3, 2012 440 94 239 773
Opened restaurants 15 13 27 55
Closed restaurants (1) (3) (8) (12)
Refranchising, Net 7 (7) - -
Ending balance - January 1, 2013 461 97 258 816
EINSTEIN NOAH RESTAURANT GROUP, INC.
NON-GAAP FINANCIAL INFORMATION
Fiscal quarter ended
January 3, January 1,
2012 2013
(14 weeks) (13 weeks)
(in thousands, except earnings per share and related
share information)
Total revenues, as $ 115,141 $ 110,646
reported
Impact of extra week in (7,300 ) -
fiscal 2011
Non-GAAP total revenues $ 107,841 $ 110,646
$ 6,120 $ 3,167
Adjustments for, net of
tax:
Extra week in fiscal (528 ) -
2011
Restructuring expenses 493 -
Strategic alternatives - 1,823
expense
Incremental interest - 165
expense
Other operating 246 776
expenses, net
$ 6,331 $ 5,931
Weighted average number
of common shares
outstanding:
Basic 16,809,502 16,992,803
Diluted 17,022,819 17,278,632
Net income per share
available to common $ 0.36 $ 0.19
stockholders – Basic
Adjustments for, net of
tax:
Extra week in fiscal (0.03 ) -
2011
Restructuring expenses 0.03 -
Strategic alternatives - 0.11
expense
Incremental interest - 0.01
expense
Other operating 0.02 0.04
expenses, net
Adjusted net income per $ 0.38 $ 0.35
common share – Basic
Net income per share
available to common $ 0.36 $ 0.18
stockholders – Diluted
Adjustments for:
Extra week in fiscal (0.03 ) -
2011
Restructuring expenses 0.03 -
Strategic alternatives - 0.11
expense
Incremental interest - 0.01
expense
Other operating 0.01 0.04
expenses, net
Adjusted net income per $ 0.37 $ 0.34
common share – Diluted
EINSTEIN NOAH RESTAURANT GROUP, INC.
NON-GAAP FINANCIAL INFORMATION
Fiscal Year Ended
January 3, January 1,
2012 2013
(53 weeks) (52 weeks)
Total revenues, as reported $ 423,595 $ 427,006
Impact of extra week in fiscal 2011 (7,300) -
Non-GAAP total revenues $ 416,295 $ 427,006
$ 13,203 $ 12,741
Adjustments for, net of tax:
Extra week in fiscal 2011 (528) -
Restructuring expenses 686 293
Strategic alternatives expense - 2,247
Incremental interest expense - 166
Other operating (income) expenses, net (246) 973
Adjusted net income $ 13,115 $ 16,420
Basic 16,629,098 16,935,018
Diluted 16,880,321 17,217,180
Net income per share available to common $ 0.79 $ 0.75
stockholders – Diluted
Adjustments for, net of tax:
Extra week in fiscal 2011 (0.03) -
Restructuring expenses 0.04 0.02
Strategic alternatives expense - 0.13
Incremental interest expense - 0.01
Other operating (income) expenses, net (0.01) 0.06
Adjusted net income per common share – Basic $ 0.79 $ 0.97
Net income per share available to common $ 0.78 $ 0.74
stockholders – Diluted
Adjustments for:
Extra week in fiscal 2011 (0.03) -
Restructuring expenses 0.04 0.02
Strategic alternatives expense - 0.13
Incremental interest expense - 0.01
Other operating (income) expenses, net (0.01) 0.05
Adjusted net income per common share – Diluted $ 0.78 $ 0.95
Contact:
Investor Relations:
Raphael Gross, 203-682-8253
rgross@icrinc.com
or
Media Relations:
Liz Brady DiTrapano, 646-277-1226
lbrady@icrinc.com
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